A former NFL defensive lineman is among five people indicted for their alleged roles in a multimillion-dollar mortgage fraud scheme in Texas.

The indictment charges that the defendants — including two bank loan officers, an appraiser and a developer — obtained $42 million in fraudulent loans from three Houston banks between 1999 and 2001.

Prosecutors said the scheme relied on inflated appraisals and shell companies to divert loan proceeds from the sale of apartments that had been converted into condominiums.

The five defendants charged with 12 counts of bank fraud are real estate developer Jerome Karam, 44, of Friendswood, Texas; former NFL star Dwight Sean Jones, 44, of Beverly Hills, Calif.; loan officers Tommy Jay Trammel, 44, and David Ranostaj, 40, both of Houston; and appraiser Jay Westrick, 44, of Houston. Each count carries a possible sentence of up to 30 years’ imprisonment, and a fine of up to $1 million

According to the indictment, Karam was a real estate developer who specialized in converting apartments to condominiums. Jones, who became a sports agent after his 12-year NFL career ended in 1996, allegedly invested in those projects and recruited his clients as investors.

Karam and Jones are accused of working with Trammel and Ranostaj — former loan officers with Southwest Bank of Texas, Bank of Houston and Whitney National Bank — to obtain loans for unqualified borrowers for amounts that exceeded the value of the property.

Westrick, a licensed appraiser, is accused of preparing inflated real estate appraisals, in amounts prosecutors said were dictated by Karam without independent analysis.

To divert money from closings, Karam, Jones, Trammel and Ranostaj allegedly created shell companies, including Jet Landscaping, which never actually did any business.

At closings, Karam allegedly inserted a line item in the HUD-1 closing statement for fees owed to Jet Landscaping. The money actually ended up in Karam’s hands, prosecutors said, and the line-item disbursements were hidden from the lenders.

The signature page of the lender-approved closing statement would allegedly be attached to a closing statement with a different distribution of the seller’s funds, leaving lenders to rely on the fraudulently certified closing statement.

“Mortgage fraud continues to be a major crime problem here in the Houston area,” said Alex Turner, the special agent in charge of the FBI’s Houston division, in a press release. Turner said the FBI has several mortgage fraud investigative initiatives underway, and the Houston Area Mortgage Fraud Task Force will be involved. He requested that anyone with information on suspected mortgage fraud cases in the area call (713) 693-5000.

Show Comments Hide Comments
Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
By submitting your email address, you agree to receive marketing emails from Inman.
Thank you for subscribing to Morning Headlines.
Back to top
Only 3 days left to register for Inman Connect Las Vegas before prices go up! Don't miss the premier event for real estate pros.Register Now ×
Limited Time Offer: Get 1 year of Inman Select for $199SUBSCRIBE×
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription